Innoviz Technologies Ltd (NASDAQ: INVZ) seems to be poised for a price surge as per its latest charts. Innoviz Technologies Ltd. designs and manufactures solid state LiDAR sensors and develops perception software that enables the mass-production of autonomous vehicles. The company manufactures InnovizOne, a solid-state LiDAR sensor designed for automakers and robotaxi, shuttle, trucking, and delivery companies requiring an automotive-grade and mass-producible solution to achieve autonomy.
Bullish Indications
#1 Falling Wedge Pattern Breakout: As you can see from the daily chart, the stock has been trading within a falling wedge pattern during the past few weeks. This is marked in the daily chart in purple color. Currently, the stock has broken out of the falling wedge pattern. A Falling Wedge Pattern is a bullish pattern. Once the stock breaks out from it, it has the potential to move further up.
INVZ – Daily Chart
#2 MACD above Signal Line: The daily chart shows that the MACD line (blue color) is currently above the MACD signal line (orange color). This is a possible bullish setup.
#3 Bullish Aroon: The value of Aroon Up (orange line) is above 70 while Aroon Down (blue line) is below 30 in the daily chart. This indicates possible bullishness.
#4 Above MA: In the daily chart, the stock is currently trading above the 50-day SMA. This implies that the bulls are currently gaining control.
#5 Bullish ADX: The ADX line is starting to move up from below –DI and +DI lines. The +DI line and the ADX line are also currently above –DI line. This indicates possible bullishness.
#6 Downtrend Channel, About To Breakout: The stock has been trading within a downtrend channel for the past several months. This channel is marked on the chart in orange color dotted lines. The stock currently looks poised for a breakout from the channel. This seems like a possible bullish sign.
INVZ – Weekly Chart
#7 Bullish RSI: The RSI is moving higher from oversold levels and is near 50. This is a bullish sign.
#8 Bullish Stochastic: The weekly chart shows that the %K line is above the %D line in the stochastic. This indicates that an upmove may be imminent.
Recommended Trade (based on the charts)
Buy Levels: If you want to get in on this trade, the ideal buy level for INVZ is above a price of around $7.55.
TP: Our target prices are $9.50 and $11 in the next 4-6 months.
SL: To limit risk, place stop-loss at $6.50. Note that the stop loss is on a closing basis.
Our target potential upside is 26% to 46% in the next 4-6 months.
For a risk of $1.05, our target rewards are $1.95 and $3.45. This is an almost 1:2 and 1:3 risk-reward trade.
In other words, this trade offers nearly 2x to 3x more potential upside than downside.
Risks to Consider
The stock may reverse its overall trend if it breaks down from the trend channel and the falling wedge pattern breakout level with a high volume. The sell-off of the stock could also be triggered in case of any negative news, overall weakness in the market, or any regulatory changes in the sector.
Happy Trading!
— Tara
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